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Impacts of Real Depreciation and Appreciation on Aggregate Output in Taiwan

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  • Yu Hsing

Abstract

Extending the IS-MP-AS model, this article finds that real depreciation helped to raise real gross domestic product (GDP) during 1999.Q1-2010.Q2 whereas real appreciation helped to increase real GDP during 2010.Q3-2016.Q4. In addition, a lower world real interest rate, a higher stock price, a higher real oil price or a lower expected inflation would increase real GDP. More deficit spending as a percent of GDP does not affect real GDP. JEL Classification : F41, E62

Suggested Citation

  • Yu Hsing, 2020. "Impacts of Real Depreciation and Appreciation on Aggregate Output in Taiwan," The American Economist, Sage Publications, vol. 65(1), pages 123-130, March.
    • Handle: RePEc:sae:amerec:v:65:y:2020:i:1:p:123-130
    DOI: 10.1177/0569434518819958
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    More about this item

    Keywords

    depreciation and appreciation; government deficits; world interest rates; stock prices; oil prices;
    All these keywords.

    JEL classification:

    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory

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